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Bank of Spain15 October 2026Documento de trabajo

Working Papers. 2638. Inflation and Price Dispersion: New Cross-Sectoral and International Evidence

The Neural Herald summary, AI-generated

Working Paper that, using web-scraped prices from over 60,000 restaurants and supermarkets in 18 countries, finds a positive and significant relationship between inflation and price dispersion. Moving from 0% to 10% inflation raises inefficient dispersion by 46% in supermarkets and 73% in restaurants.

Key points

Who is affected

Researchers and monetary policymakers.

Plain-language version

A Bank of Spain study using prices from over 60,000 supermarkets and restaurants in 18 countries finds that when inflation is higher, prices for the same item vary more between shops. Going from 0% to 10% inflation raises that gap by 73% in restaurants. It concludes that tolerating higher inflation is costly.
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